NYC Health + Hospitals reported a $673 million loss for the third quarter of the fiscal year. That is more than double what the 11-hospital public health system lost in the same quarter last year, reported Becker’s Hospital CFO.
The system reported a 1.8% increase in revenues to $6.7 billion in the quarter, but net patient service revenues dropped by 9% because of “lower payments from the disproportionate share hospital (DSH) and upper payment limit programs.”
Despite the reported loss, H + H said it expects to cut its $779 million budget gap this fiscal year and end with $185 million cash on hand.
Although it is one of the largest public healthcare systems in the country, NYC Health + Hospitals is facing similar financial issues as rural, community systems. H+H has a large Medicaid population, and with Medicaid cuts on the table, health systems may have more issues down the road. Cuts to Medicaid would lead to more uninsured Americans and more uncompensated care.
As a recent Moody's report noted, reduced DSH patients will constrain growth at for-profit hospitals. There has also been disagreement in how the payments that help offset costs for Medicaid patients and the uninsured should be calculated. H+H launched a plan to improve financials about two years ago. It included plans to extend hour and increase the number of patients and set a goal if improvement by 2020.
While there may still be time for a turnaround, financial statements from last month showed a $776 million operating loss for the first half of FY17. The company responded by announcing a redesign of its management structure, but said no layoffs were expected.
One way that H+H is looking to improve finances is through implementing the Epic revenue cycle system. Officials said in May the new revenue cycle system will “improve efficiency and ensure that the health system is collecting the maximum amount of revenue for the services it delivers.” They expect it will improve clinical documentation, reduce claims denials and accelerate reimbursements.
The system has had a bad history with EHR rollout, however. It has been far behind on implementing its $764 million Epic system. Despite being expected to go live throughout the organization last April, only a handful of the system's 11 hospitals have implemented the EHR.